HealthSouth boosts stake in hospital, ups its forecast for 2014 fiscal year

By Russ Britt

Hospital operator HealthSouth Corp. said Monday it should blow past its own full-year earnings forecast, thanks to a newly-acquired stake in a Massachusetts rehabilitative hospital.

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HealthSouth
/quotes/zigman/438684/delayed/quotes/nls/hlsHLS said it increased its ownership stake of Fairlawn Rehabilitation Hospital in Worcester, Mass., from 50% to 80%, thus increasing its fiscal 2014 outlook. The company said Fairlawn’s results are now included in HealthSouth reports as of June 1.

The operator of hospitals in 28 states, Birmingham, Ala.-based HealthSouth said it now expects to exceed its earlier forecasted adjusted earnings range of $1.86 to $1.91 a share. Fairlawn would have added $6 million to HealthSouth’s 2013 earnings had it been included in the system with just its 50% interest, the company said. HealthSouth says it should see a $25 million to $30 million gain during the second quarter.

Analysts polled by FactSet had expected $1.91 a share in adjusted earnings for 2014. Shares ended the day down marginally to $34.84.

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